2016 guidance reiterated: net sales to increase 7 percent to
approximately $800.0 million and diluted EPS to increase 10 percent to
approximately $0.78 per share

Consistent with Company guidance issued on February 23, 2016, net sales
for the first quarter of 2016 were $95.8 million compared to $114.2
million reported in the comparable period in 2015. The net loss for the
first quarter of 2016 was $17.4 million, or $1.01 per diluted share.
This compares to a net loss of $7.6 million, or $0.40 per diluted share,
reported in the comparable period in 2015. Adjusted EBITDA for the first
quarter was negative $9.2 million, compared to Adjusted EBITDA of
negative $0.9 million in 2015. See note below on “Use of Non-GAAP
Financial Information.”

The year-over-year reduction in first quarter 2016 net sales and
earnings reflects a decline in sales of a product line in international
markets, and the increase in the quarterly loss also includes the impact
of a loss of $0.05 per share due to fewer common shares outstanding
during the quarter. The reduced share count is a direct result of the
Company’s ongoing stock buy-back program. On a static share count, the
Company’s earnings would have been a loss of $0.96 per share, in the
middle of the range of previously announced guidance for the quarter. As
reflected in the Company’s guidance for the quarter, higher marketing
expenses, including the timing of expenses associated with an earlier
Easter holiday season, contributed to the decline in earnings from the
year ago period.

“Our performance in the first quarter is in line with our expectations
going into 2016. We remain committed to maximizing the value of our
portfolio with customers and consumers,” Stephen Berman, Chairman and
Chief Executive Officer, stated. “As expected, our gross margin
continues to improve due to ongoing margin enhancement initiatives,”
said Berman.

Partnering with best-in-class content creators, this summer JAKKS
Pacific is launching several new entertainment-licensed products
inspired by major theatrical releases, including Batman vs. Superman:
Dawn of Justice, Captain America: Civil War, Teenage Mutant Ninja
Turtles: Out of the Shadows,Warcraft, Alice in Wonderland:
Through the Looking Glass and Finding Dory.

“Looking beyond summer, our Fall lines are proceeding as planned and we
expect our broad category of products to have wide placement at retail
in the second half,” said Berman.

Working Capital and Cash Flow

As of March 31, 2016, the Company’s working capital was $226.9 million,
including cash and cash equivalents of $118.9 million, compared to
working capital of $234.2 million, including cash and cash equivalents
of $105.3 million, as of March 31, 2015. Net cash provided by operating
activities for the first quarter was $32.6 million, compared to $38.8
million in the year ago period.

Reiterating 2016 Guidance

For 2016, JAKKS continues to forecast net sales to increase 7 percent to
approximately $800.0 million; diluted earnings per share to increase 10
percent to approximately $0.78 per share, subject to share count
changes; and Adjusted EBITDA to increase 28 percent to approximately
$65.0 million. This guidance reflects anticipated gross margin expansion
and operating margin growth in 2016.

Share Repurchase

In June 2015, the Board of Directors authorized the Company to
repurchase up to $30.0 million worth of shares of the Company’s
outstanding common stock and/or convertible notes through open market
purchases or in privately negotiated transactions. Approximately 2.9
million shares of common stock at an aggregate cost of $23.0 million and
$2.0 million face amount of our 2020 convertible notes at a cost of $1.9
million were repurchased through the end of the first quarter. At
quarter end, approximately $5.0 million remained available in the
current buy-back authorization.

Use of Non-GAAP Financial Information

In addition to the preliminary results reported in accordance with U.S.
GAAP included in this release, the Company has provided certain non-GAAP
financial information, including Adjusted EBITDA which is a non-GAAP
metric that excludes various items that are detailed in the financial
tables and accompanying footnotes reconciling GAAP to non-GAAP results
contained in this release. Management believes that the presentation of
these non-GAAP financial measures provides useful information to
investors because the information may allow investors to better evaluate
ongoing business performance and certain components of the Company’s
results. In addition, the Company believes that the presentation of
these financial measures enhances an investor’s ability to make
period-to-period comparisons of the Company’s operating results. This
information should be considered in addition to the results presented in
accordance with GAAP, and should not be considered a substitute for the
GAAP results. The Company has reconciled the non-GAAP financial
information included in this release to the nearest GAAP measures. See
the attached “Reconciliation of Non-GAAP Financial Information.”

Conference Call Live Webcast

JAKKS Pacific will webcast its first quarter earnings call at 9 a.m.
Eastern Time/6 a.m. Pacific Time today. To listen to the live webcast
and access the accompanying presentation slides, go to www.jakks.com/investors
and click on the earnings website link under Presentations at least 10
minutes prior to register, download and install any necessary audio
software. A replay of the call will be available on JAKK’s website
approximately one hour following completion of the call through May 21,
2016, ending at 11:59 p.m. Eastern Time/8:59 p.m. Pacific Time. The
playback can be accessed by calling 888-843-7419 or 630-652-3042 for
international callers, passcode “4232 5232#” for both playback numbers.

About JAKKS Pacific, Inc.

JAKKS Pacific, Inc. (NASDAQ: JAKK) is a leading designer, manufacturer
and marketer of toys and consumer products sold throughout the world,
with its headquarters in Santa Monica, California. JAKKS Pacific’s
popular proprietary brands include BIG-FIGS™, XPV®, Real Construction®,
Max Tow™ and Friends, Disguise®, Moose Mountain®, Funnoodle®, Maui®,
Kids Only!®, as well as a wide range of entertainment-inspired products
featuring premier licensed properties. DreamPlay Toys, LLC is a joint
venture between JAKKS and NantWorks LLC to develop, market and sell toys
and related consumer products incorporating NantWorks’ proprietary iD™
recognition technology. Through JAKKS Cares, the company’s commitment to
philanthropy, JAKKS is helping to make a positive impact on the lives of
children. Visit us at www.jakks.com and
follow us on Instagram (@jakkstoys),
Twitter (@jakkstoys)
and Facebook (JAKKS
Pacific).

This press release may contain “forward-looking statements” (within the
meaning of the Private Securities Litigation Reform Act of 1995) that
are based on current expectations, estimates and projections about JAKKS
Pacific’s business based partly on assumptions made by its management.
These statements are not guarantees of future performance and involve
risks, uncertainties and assumptions that are difficult to predict.
Therefore, actual outcomes and results may differ materially from what
is expressed or forecasted in such statements due to numerous factors,
including, but not limited to, those described above, changes in demand
for JAKKS Pacific’s products, product mix, the timing of customer orders
and deliveries, the impact of competitive products and pricing, and
difficulties with integrating acquired businesses. The “forward-looking
statements” contained herein speak only as of the date on which they are
made, and JAKKS undertakes no obligation to update any of them to
reflect events or circumstances after the date of this release.

JAKKS Pacific, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

March 31,

December 31,

2016

2015

(In thousands)

ASSETS

Current assets:

Cash and cash equivalents

$

118,914

$

102,528

Accounts receivable, net

85,471

163,387

Inventory, net

53,470

60,544

Income taxes receivable

24,008

24,008

Prepaid expenses and other

32,912

31,901

Total current assets

314,775

382,368

Property and equipment

115,116

112,088

Less accumulated depreciation and amortization

95,256

93,653

Property and equipment, net

19,860

18,435

Goodwill

44,024

44,199

Trademarks & other assets, net

44,912

47,618

Investment in DreamPlay, LLC

7,000

7,000

Total assets

$

430,571

$

499,620

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable and accrued expenses

$

52,988

$

89,067

Reserve for sales returns and allowances

13,104

17,267

Income taxes payable

21,741

21,067

Total current liabilities

87,833

127,401

Long term debt, net

207,797

209,166

Other liabilities

5,303

5,155

Income taxes payable

2,199

2,199

Deferred tax liability

2,199

2,293

Total liabilities

305,331

346,214

Stockholders’ equity:

Common stock, $.001 par value

20

21

Additional paid-in capital

180,363

194,743

Treasury stock

(24,000

)

(28,322

)

Accumulated deficit

(20,806

)

(3,391

)

Accumulated other comprehensive loss

(10,775

)

(10,051

)

Total JAKKS Pacific, Inc. stockholders’ equity

124,802

153,000

Non-controlling interests

438

406

Total stockholders’ equity

125,240

153,406

Total liabilities and stockholders’ equity

$

430,571

$

499,620

Working Capital

$

226,942

$

254,967

JAKKS Pacific, Inc. and Subsidiaries

First Quarter Earnings Announcement, 2016

Condensed Statements of Operations (Unaudited)

Three Months Ended March 31,

2016

2015

(In thousands, except per share data)

Net sales

$

95,809

$

114,201

Less cost of sales

Cost of goods

52,178

62,501

Royalty expense

11,234

15,517

Amortization of tools and molds

1,214

805

Cost of sales

64,626

78,823

Gross profit

31,183

35,378

Direct selling expenses

11,559

6,862

Selling, general and administrative expenses

30,618

30,757

Depreciation and amortization

2,822

1,958

Loss from operations

(13,816

)

(4,199

)

Other income (expense):

Other income

75

–

Interest income

16

19

Interest expense

(3,226

)

(2,974

)

Loss before provision for income taxes

(16,951

)

(7,154

)

Provision for income taxes

432

427

Net loss

(17,383

)

(7,581

)

Net income attributable to non-controlling interests

32

–

Net loss attributable to JAKKS Pacific, Inc.

$

(17,415

)

$

(7,581

)

Loss per share

$

(1.01

)

$

(0.40

)

Shares used in loss per share

17,218

19,090

JAKKS Pacific, Inc. and Subsidiaries

Reconciliation of Adjusted EBITDA

For the Three Months Ended March 31, 2016 and 2015

Reconciliation of GAAP to Non-GAAP measures:

This press release and accompanying schedules provide certain
information regarding Adjusted EBITDA, which may be considered
non-GAAP financial measures under the rules of the Securities and
Exchange Commission. The non-GAAP financial measures included in
the press release are reconciled to the corresponding GAAP
financial measures below, as required under the rules of the
Securities and Exchange Commission regarding the use of non-GAAP
financial measures. We define Adjusted EBITDA as income (loss)
from operations before depreciation, amortization and adjusted for
certain non-recurring charges incurred, primarily related to
reorganization expenses and certain non-cash charges for
restricted stock compensation expense. Adjusted EBITDA is not a
recognized financial measure under GAAP, but we believe that it is
useful in measuring our operating performance. We believe that the
use of the non-GAAP financial measure Adjusted EBITDA enhances an
overall understanding of the Company’s past financial performance,
and provides useful information to the investor by comparing our
performance across reporting periods on a consistent basis and the
use of Adjusted EBITDA by other comparable companies as a measure
of performance.

Investors should not consider these measures in isolation or as a
substitute for net income, operating income, or any other measure
for determining the Company’s operating performance that is
calculated in accordance with GAAP. In addition, because these
measures are not calculated in accordance with GAAP, they may not
necessarily be comparable to similarly titled measures employed by
other companies.